Battery swapping technology offers a way to switch the exhausted battery or battery pack of a vehicle for a fully charged one. It can minimize the time spent waiting for the vehicle's battery to recharge and it increases the available run time. In addition, battery swapping stations provide a faster solution to range anxiety and require significantly less area to install compared to charging stations.
According to the report of Allied Market Research, the global electric vehicle battery swapping market is projected to reach $852.6 million by 2030, growing at a CAGR of 24.4% from 2021to 2030. Due to government-backed incentives and support packages provided by several industrialized nations for greener transportation, the electric vehicle battery swapping industry has boomed in developing countries. Furthermore, the rise of improved battery swapping models and services, as well as the rapid emergence of shared e-mobility ecosystems are projected to open up attractive prospects for industry participants in the future.
The global automotive sector has been significantly affected by a decline in demand for both new and used vehicles powered by diesel and petrol due to the Covid-19 pandemic. On the other hand, the pandemic has hastened other trends, such as electrification in two-wheeler and three-wheeler vehicles, which accelerated the growth of electric vehicles across the globe.
Due to the increase in demand for electric vehicles and rapidly changing preferences of the customers from vehicles powered by petrol and diesel towards electric vehicles, the companies have invested in developing more efficient products and increased collaboration with each other.
For instance, Marelli, one of the world's leading global independent suppliers of automotive has partnered with RWTH Aachen University. The partnership aims to focus on innovative electric vehicle technology and related manufacturing technologies. In addition, the companies agreed to collaborate on research projects including the permanent performance and development of novel electric motors.
The market for EV battery swapping thrives in developing countries Including India. For instance, Tata Power Delhi Distribution Ltd. (TPDDL) recently joined forces with Sun Mobility, one of the leading providers of novel technological solutions. This partnership aims to replace discharged batteries with fully charged batteries in a matter of minutes and to fulfill the growing demands of swappable batteries in India.
Apart from this, Honda Motor Co. Ltd., KTM AG, Yamaha Motor Co., Ltd., and Piaggio Group have created an international collaboration to develop a standardized swappable battery system. The collaboration aims to promote swappable battery technology as an alternative to fixed battery electric vehicles, lowering vehicle prices and overall charging time.
Recent developments and new strategic alliances have captured the interest of companies in the battery swapping industry. However, there are several challenges to overcome including high cost of electric vehicles, expensive batteries, lack of charging or replacement stations, and poor infrastructure. Furthermore, the high initial setup and ongoing expenses of battery switching stations limit market penetration.
Despite all these constraints, the rapid rise of shared e-mobility and the introduction of improved battery swapping models and services are projected to provide profitable prospects in the future. To minimize overall costs, the Indian government has aided this industry by exempting electric vehicles from paying fees for the issue or renewal of registration certificates.
Experts believe that the EV battery swapping industry will witness new opportunities in the future. Government and businesses appreciate the benefits of electric vehicles, including cleaner cities and less damage from road rage and accidents. For instance, the UK government's e-bike scheme states that government, as well as businesses, should work together to subsidize the cost of ownership. Apart from it, the Ireland government offered an incentive of €2,000 for the installation of the electric charging station. Apart from such initiatives, key players in the EV battery swapping market are focusing on R&D operations to produce revolutionary electric vehicles.
The Asia-Pacific region is expected to dominate the electric vehicle battery industry in the forthcoming years. As part of the National Electricity Mobility Mission Plan, the government of India has launched the Faster Adoption and Manufacturing of Electric Vehicles (FAME) plan. Its goal is to give a boost to the development of the market for hybrid and electric vehicles, which includes two-wheelers, three-wheelers, cars, and other vehicles. Moreover, the government has planned an outlay of $70.3 million to propel the adoption of EVs.
When it comes to saving the environment, electric vehicles are a viable option and battery swapping is the best solution for reducing pollution and saving time. With an increase in support from the governments and a rise in awareness, EV battery swapping technology has surely a bright future in coming years.